Understanding the UK Sponsor Licence: A Complete Guide for Employers

A sponsor licence is an essential authorisation issued by the UK government that allows businesses to legally hire and sponsor overseas workers. Without this licence, UK employers cannot employ most foreign nationals who require a visa to work in the country. Holding a sponsor licence not only enables businesses to hire global talent but also ensures compliance with UK immigration laws.

Contents

In this guide, we will explore the different types of sponsor licences, how they work, eligibility criteria, application process, costs, and key responsibilities. If you want detailed information, check out this sponsor licence guide.

A sponsor licence is granted by UK Visas and Immigration (UKVI) to allow UK-based organisations to sponsor non-UK workers. Employers use it to issue Certificates of Sponsorship (CoS), which are mandatory for visa applications under the points-based system.

Essentially, having a sponsor licence means your business can recruit overseas workers legally, monitor them according to UKVI rules, and report any changes in employment. It is a key legal requirement for companies looking to hire skilled or temporary workers from abroad.

Hiring International Talent

Without a sponsor licence, employers cannot hire skilled workers, temporary workers, or international students. By obtaining a licence, businesses gain access to a wider talent pool, allowing them to fill positions that require specialised skills.

Legal Compliance

A sponsor licence ensures that your organisation complies with UK immigration laws. Non-compliance can lead to severe consequences, including suspension of the licence, fines, or a ban from hiring foreign workers in the future.

Business Growth

Sponsoring international employees can support business growth by bringing in diverse skills, innovation, and global perspectives.

Employers in the UK must have a sponsor licence if they want to employ someone who:

Requires a visa to work in the UK
Does not already have settled or pre-settled status
Is not an Irish citizen or exempt under certain immigration rules

Employers do not need a licence for:

UK citizens
Workers with indefinite leave to remain
Individuals already authorised to work in the UK

The UK government offers several types of sponsor licences depending on the role and route of employment:

Skilled Worker Licence

For businesses hiring skilled professionals under the Skilled Worker route.

Temporary Worker Licence

Covers short-term employment, including seasonal, charity, creative, or religious work.

For educational institutions sponsoring international students.

Each type of licence has specific eligibility requirements and responsibilities.

Once your business obtains a sponsor licence, it must adhere to several key rules:

Assign Certificates of Sponsorship (CoS): Every worker needs a CoS to apply for a visa.
Maintain Compliance: Track attendance, monitor employment changes, and update records in the Sponsorship Management System (SMS).
Respond to UKVI Requests: Employers must cooperate with inspections or audits.

Non-compliance can result in licence suspension or revocation, so it’s crucial to understand and follow all duties.

Step 1: Check Eligibility

Your business must be a legitimate UK entity (Ltd, LLP, charity, etc.) and able to show:

Trading presence in the UK
Compliance with tax and payroll regulations
No unspent criminal convictions related to fraud or immigration offences

Step 2: Choose Licence Type

Determine whether you need a licence for skilled workers, temporary workers, students, or multiple categories.

Step 3: Appoint Key Personnel

UKVI requires you to assign three roles within your organisation:

Authorising Officer: Overall responsibility for compliance
Key Contact: Main point of communication with UKVI
Level 1 User: Manages day-to-day operations in the SMS

Step 4: Prepare Supporting Documents

Commonly required documents include:

Business registration certificates
Payroll and tax records
Evidence of HR systems and right-to-work checks

Step 5: Apply Online and Pay Fees

Submit the application through the official UKVI portal. Typical processing time is up to 8 weeks. Fees vary depending on the licence type and organisation size.

Licence Type	Small/Charity	Medium/Large
Skilled Worker	£536	£1,476
Temporary Worker	£536	£536
Combined Worker + Temp	£536	£1,476

Additional costs may include CoS fees, Immigration Skills Charge, and optional priority services.

Responsibilities After Licence Approval

Assigning Certificates of Sponsorship

After approval, you can assign CoS to employees, which allows them to apply for the appropriate visa.

Monitoring Sponsored Workers

Employers must maintain accurate records, report absences, and notify UKVI of any changes.

Compliance and Inspections

UKVI may conduct compliance checks, and failure to meet obligations can lead to fines, licence suspension, or revocation.

Common Mistakes to Avoid

Incomplete Documentation: Ensure all supporting documents are correct and up to date.
Non-Compliance After Approval: Failing to report changes or maintain records can result in penalties.
Misuse of Sponsorship: Avoid practices that could be interpreted as exploitation of the visa system.

Access to international talent with specialised skills
Ability to grow your business and fill skill gaps
Legal authorisation to employ non-UK workers
Strengthened business reputation for compliance and professionalism

Final Tips for Employers

Start preparing early before hiring overseas employees.
Ensure HR and payroll systems are up to date.
Keep accurate records and respond promptly to UKVI.
Consider professional guidance for complex applications.

Obtaining a sponsor licence is a vital step for UK employers who want to hire skilled international workers. While the process can be detailed, the benefits of access to a global talent pool and legal compliance make it well worth the effort.